No fewer than three of our "daily reads" highlighted the Barron's article about the individual investor.
Pradeep Bonde at Stockbee emphasized a point we should also have made -- that this was a surprising story, given the normal bearish orientation of the source. (And thanks, Pradeep, for the kind words about our own analysis.)
Paul Kedrosky suggests that the small investor story puts things in context and helps us watch for signs of a market top. Paul also covered another Barron's article -- one that interviewed a portfolio manager with a hot hand. Readers should check out Paul's interpretation, but please also read our comment.
Bespoke Investment Group does a nice job in reviewing the various statistics used in the article, showing that some are questionable indicators.
We also had some excellent comments on the original post. Our readers see much of the same individual investor behavior that is reported in the article.
Trading Idea?
This all raises a good trading question. If the return of the individual investor can be expected before the market tops, perhaps there is a trade in a retail broker. We currently own Merrill Lynch (MER) but that is not a "pure play" on the return of the small investor.
